🌱 Beyond Meat: Not Yet A Money Plant?

Twitter introduces paid tweets. Best Buy downsizes

Hey Global Investor, here’s what you need to know before the US markets open.

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🌱 Beyond Meat: Not Yet A Money Plant?

Another victory for Beyond Meat (BYND) as it announced a strategic partnership with McDonald’s (MCD) and Yum! Brands (YUM), adding the companies alongside PepsiCo (PEP) to its recent list of high-profile deals. (Tweet This)

Background: Formerly known as Savage River, Inc., California’s Beyond Meat was founded in 2009, with a mission to increase plant-based protein consumption for a more sustainable and ethical future. The company went public in May 2019, pricing its IPO at $25 per share, which surged 163% by the day’s end, considered the best in nearly two decades.

Beyond’s meteoric rise aligns with public sentiments on animal cruelty and growing food trends such as vegan, which caught the attention of major brands. Beyond has found itself under the spotlight while the major restaurant chains are scrambling to diversify their menus and endear themselves to customers’ changing palates and preferences.

The biggest catapult for Beyond came with Dunkin’s partnership across 9K stores nationally. This partnership amongst many (Tim Horton’s & Blue Apron to name a few), and talks with McDonald’s skyrocketed the stock 500% by the end of  2019.

What Happened?: Beyond Meat reported underwhelming numbers resulting from an overall drop in foodservice demand during the pandemic. With restaurants operating at restricted capacity or being closed altogether, there has been a significant drop in demand for Beyond’s products.

Key numbers for Q4:

  • Revenue: $101.9M Vs. consensus estimate of $103.2M
  • EPS: Adjusted net loss of $0.34 Vs. analyst expectation of a loss of $0.13

Alongside the uninspiring numbers, Beyond also announced strategic agreements with McDonald’s Corp and Yum! Brands. Over the next three years, Beyond will be the preferred supplier for McDonald’s McPlant sandwich. Yum! Brands will also partner with Beyond for a new plant-based meat menu that will only be available at its quick-service restaurants (Taco Bello, Pizza Hut, KFC).

This positive news notwithstanding, Beyond Meat declined to provide guidance for FY21 citing uncertainty due to the pandemic. Patience might be wearing thin with the investors who want Beyond Meat to graduate beyond losses and well on its road to profitability that is in keeping with its valuation.

Market Reaction: BYND closed at $143.75, down 5.46%; in pre-market trading, the stock is up 7.47%.

Company Snapshot 📈

BYND $143.75 -8.30 (-5.46%)

Analyst Ratings (22 Analysts) BUY 14%  HOLD 55%  SELL 22%

Newsworthy 📰

Exchange: AT&T to sell minority stake in DirecTV to buyout firm TPG Capital (T -2.55%)

Pricey Tweets: Twitter exploring pay-to-follow model (TWTR +3.71%)

Goodbye: Best Buy cut 5,000 jobs even as sales soared during pandemic (BBY -9.27%)

Later Today 🕒

  • Before Market Open: Carter’s Inc Earnings (CRI)
  • Before Market Open:  Foot Locker Inc Earnings (FL)
  • Before Market Open: Draftkings Inc Earnings (DKNG)
  • 7:00 PM IST: Consumer spending
  • 7:00 PM IST: Core inflation

Fun Fact of The Day 🌞

The first oranges weren’t orange in colour.

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